President Biden will soon sign into law a $1.9 trillion bill intended to boost the economy and help the U.S. deal with the effects of the novel coronavirus pandemic. It’s only the second bill Biden has signed into law and likely to be one of the most significant. So let’s look at what we learned from the process of enacting this legislation:
The Biden-led Democratic Party is more liberal and populist than the Obama or Clinton versions.
In 2009, Barack Obama was in the White House and Democrats controlled both the U.S. House and Senate. The Great Recession was still in full force, and one of the first things the party did was propose a stimulus bill. But many Democrats, particularly more moderate members of Congress, were wary of being cast as supporting too much spending. So Democrats made sure the bill cost less than $1 trillion, eventually landing at a figure of $787 billion.
How White House economists are thinking about COVID-19 relief | FiveThirtyEight
Twelve years later, Democrats passed a bill with about double the spending of the 2009 bill.1 The economic challenges caused by COVID-19 are much different than those caused by the banking and housing-bubble crash of 2008, so it’s hard to make an apples-to-apples comparison and say whether the 2009 stimulus or this one is closer to the optimal range of spending to boost the economy. But in my view, the higher spending in the 2021 stimulus bill compared to 2009 isn’t just about the underlying economic conditions. Today’s Democratic Party is further to the left than its 2009 version — in particular, it is more open to spending and much less worried about being cast as big-government liberals. So while this bill is about boosting the economy in the short term because of COVID-19, it also includes a number of liberal policies that Democrats probably would have tried to adopt even if there was no coronavirus-induced shutdown, such as increasing the child tax credit to $3,000 per school-aged child and increasing subsidies for people buying health insurance through the Affordable Care Act.
Indeed, the party’s left wing is delighted with this legislation.
“This is spending at the scale of the problem,” said Mike Konczal, director of the progressive Roosevelt Institute.
He added, “It wasn’t cut down by worries of doing too much, or performing moderation, or cynical debt fear. Remarkable.”
David Dayen of the left-leaning American Prospect described the bill as “a down payment on reversing 40 years of inequitable treatment for the middle class in America.”
“The American Rescue Plan is the most significant piece of legislation to benefit working people in the modern history of this country,” said Sen. Bernie Sanders.
What has changed since 2009 to make Democrats more comfortable with this kind of bill? Most of all, the left wing of the party — think Sens. Sanders and Elizabeth Warren — has much more power and influence, pulling more moderate figures like Biden to the left. Democrats also seem to have concluded that there is not much electoral risk to spending a lot or being portrayed as too eager to spend federal dollars. That’s probably because it’s not clear that Republicans suffered electorally because of the massive increase in the national debt during the Trump presidency.
Democrats, and Biden specifically, also seem to have learned some lessons since those early days of the Obama presidency …
To Biden, ‘unity’ does not necessarily mean bipartisanship.
Before his inauguration, Biden laid out a $1.9 trillion proposal for COVID-19 relief. I figured this was a negotiating tactic and that he would bring this figure down in part to win over Republican votes on Capitol Hill. He did not. Instead, Biden and his aides met with congressional Republicans and said the administration was open to striking a compromise with the GOP — but Biden never fundamentally changed his proposal. The Biden administration appeared to prioritize enacting its policy goals over trying to reach a deal that Democrats didn’t think Republicans were interested in anyway. (More on Republicans’ posture in a bit.)
Biden’s approach suggests that the former vice president took the same lesson from the Obama years that political experts and other Democratic politicians did: The GOP may be unwilling to reach deals with a Democratic president on major legislation, no matter its details. The Obama administration spent months in 2009 negotiating with congressional Republicans on the bill that is now known as Obamacare, even though it is now fairly clear that Republicans were never going to reach an agreement and make one of Obama’s signature pieces of legislation bipartisan.
If their approach to the COVID-19 relief bill is any guide, it looks like Biden and his aides aren’t exactly abandoning the president’s unity rhetoric from his inaugural speech — they’re just not willing to sacrifice legislative goals in chase of it. Instead, the Biden team is pursuing unity by performing the rituals of bipartisanship — holding regular meetings with congressional Republicans and being polite to them — and by pursuing legislation that is popular with a substantial number of Republicans voters (and continually emphasizing that point). Polls, for example, showed a big chunk of Republican voters backed the stimulus proposal.
But will major Biden initiatives get passed with lots of Republican votes? That seems very, very unlikely at this point. Congressional Democrats are already discussing using the reconciliation process again — that’s how this stimulus package was enacted — to pass an infrastructure bill. By using reconciliation, Democrats can bypass the Senate filibuster and pass legislation without any GOP votes.
Democrats have a big filibuster problem.
Democrats like Sanders were desperate to include a minimum wage increase in the COVID-19 relief bill because it may be one of the few major laws enacted this year — at least as long as the filibuster remains in place. But the Senate’s parliamentarian said that a $15 federal minimum wage would violate the budgetary rules that govern what can be included in reconciliation bills. So Democrats dropped it from the legislation.
As long as a 60-vote threshold remains in place, it is likely that a $15 minimum wage is not the only major part of the Democratic agenda that will go nowhere. Bills to reform the election system, limit discrimination against Americans on the basis of sexual orientation and gender identity and change policing practices that were passed recently in the House also seem dead on arrival in the Senate because of the filibuster.
Democrats also have a big Manchin-Sinema problem.
This is true most of all with regards to the filibuster, of course. Sens. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona are the most vocal Democrats opposed to getting rid of the filibuster. And because Democrats control only 50 Senate seats,2 the filibuster will remain in place as long as any Democrat (and all Republicans) wish it so.
But at least based on this stimulus process, Democrats may have a Manchin-Sinema problem, even putting the filibuster aside. Getting the vote of the senator from West Virginia, in particular, will continue to be hard. Biden may get the house, plane and oval-shaped office, but there’s a chance his years in office are most defined by what Manchin wants (and doesn’t want).
Democrats’ COVID relief bill is popular, but GOP may not vote for it
On this stimulus bill, Manchin — along with a few more conservative Democrats — forced the party to limit cash payments to individuals making less than $80,000 per year, while the bill had originally allowed people making up to $100,000 to get at least some money. Manchin also successfully pushed to lower enhanced unemployment benefits in the bill from $400 to $300 per week. And while this bill was making its way through Congress, Manchin announced his opposition to Neera Tanden, Biden’s then-nominee to run the Office of Management and Budget, effectively killing her nomination. The senator is already hinting that he is wary of backing an infrastructure bill if it doesn’t have some GOP support.
All that said, Manchin, who represents a state that Biden lost by 39 percentage points in 2020, did just back a $1.9 trillion bill. So let’s not overstate his resistance to his party’s main goals.
Republicans are using their Obama-era playbook.
Democrats all but guaranteed strong GOP opposition to this bill by sticking to its $1.9 trillion price tag and including non-COVID-19-related priorities in it. At the same time, it is not clear that any but a few Republicans would have ever voted for a Biden stimulus. The votes over Trump’s impeachment and removal and controversies over Reps. Liz Cheney and Marjorie Taylor Greene had divided congressional Republicans. So GOP congressional leaders wanted the party to unite in opposing Biden’s stimulus bill.
And even without a desire to get past the intra-party friction over Trump, Republicans might have still mobilized against this bill. All indications are that Republicans think that the way to win back control of the House and/or Senate next year is to repeat their strategy from the Obama years: intense and total opposition to the agenda of the sitting Democratic president.
Those are my main takeaways from the COVID-19 relief bill. None are exactly surprising, but this process has clarified how Biden is approaching his presidency.
During the 2020 campaign and after his victory, Biden had suggested that some Republicans could be persuaded to back his agenda because of his persona and long tenure on Capitol Hill. Those comments were (and are) probably politically and electorally smart, because most voters want the parties to work together, and most lawmakers are going to view a president more favorably if he at least gives the veneer of wanting to work with them. But it looks like that rhetoric was just that: a veneer. I mean, maybe Biden actually thought he could win some Republican votes, and the COVID-19 relief bill has showed him how hard-to-impossible that will be. But, more likely, Biden’s talk of working with Republicans was politically expedient spin all along.
When things got real, Biden pushed a bill through with only Democratic votes, didn’t make major changes to placate Republicans and defined bipartisanship in a way that didn’t include getting any support from Republican members of Congress. Biden can’t change the underlying partisan dynamics in Washington, and it looks like he is quite aware of that, no matter what he told voters on the campaign trail.